According to the Construction and Development of Railways Deputy of the Construction and Development of Transportation Infrastructures Company (CDTIC), the railway projects which are expected to be finished by mid of 2024 are as follows:

• Rasht – Caspian Port 37Km railway with 84% progress in September 2023
• Hamedan – Sanandaj 150Km railway with 90% progress in September 2023
• Mianeh – Ardabil 175 Km railway with less than 40% progress in September 2023

While the first two projects have been planned to be finished by March 2024, it seems very difficult for the third project that meets its deadlines due to the lack of money resources required for being moved forward. The official news indicates that the debts of CDTIC to its contractors exceed 40K billion Rials.

Having faced difficulties to supply money needs of its aforementioned projects, CDTIC succeeded to obtain particular approvals enabling them to access to reliable money resources for their future projects. According to the said approvals, from one hand CDTIC was authorized “to offset” his debts to the contractors by means of “oil remittance” and from the other hand the National Development Fund was authorized to provide financial facilities for (or invest directly in) development of the railway network system. Relying on these, CDTIC recently approved 4 new development projects all (apparently) assigned to Khatam-al Anbiya Construction Headquarters as the main contractor who would have to obviously run the projects via partnerships / consortiums / subcontracts. The projects (with the total length of around 2500Km) have been identified as follows:

• Chabahar – Zahedan railway (east corridor)
• Rasht – Astara railway (north corridor)
• Doroud – Khorramabad - Andimeshk railway (west corridor)
• Shiraz – Boushehr railway (south corridor)

In addition to the above, in the 7th Five-Year Development Plan Law whose draft (dedicated by the Government) is currently under review and debates by the Parliament commissions and members, the Government, according to the latest reports published on the Parliament’s website, would be obliged to: 

• Adding 3200km new railway to the railway network system,
• 30% increment in the length of “double track railways + electric railways”,
• 100% increment in the length of the subsidiary railways (for the railway freight),
• Adding 550 new locomotives to the transportation fleet,
• 70% increment in the speed of train transportation and
• Improvement the capacity of bottlenecks in the railway network    

According to our best information, CDTIC is planning to promote private sector to invest in “subsidiary railways” (via BOT contracts with authorizing them to charge the factories / mines / companies who use the said railway for being linked to the national network) and “innovation of locomotive fleet”. 

 

For more information and advice, please contact us in Tavakoli & Colleagues law firm.